ASIAN DEVELOPMENT BANK (IMMUNITIES AND PRIVILEGES) ORDER 1966. (Hansard, 4 August 1966)

§ LORD BESWICK
My Lords, I beg to move that an Humble Address be presented to Her Majesty praying that the Asian Development Bank (Immunities and Privileges) Order 1966, be made in the form of the draft laid before this House on July 12. This Order is required to give effect to Chapter8 of the Agreement, to which we are a signatory, establishing the Asian Development Bank. The Bank is a project of the United Nations Economic Commission for Asia and the Far East and 22 countries agreed the project on December 4 last. Subsequently, I understand, a further nine signatures have been added.
The purpose of the Bank is to make avaliable additional development finance by mobilising funds both inside and outside the region, but it will give priority in the use of those funds to regional and sub-regional development projects. It is in some ways comparable to the Inter-American and African Development Banks, but unlike other regional banks, it acknowledges the part which developing countries can play in assisting Asian economic development by extending full membership to non-regional development countries such as the United Kingdom. The progress made since 1965 towards the establishment of the Bank is considerable, and noble Lords will be interested to learn that 65 per cent. of the Bank's initial capital is being provided by Asian countries.
The purpose of the present draft Order is to enable Her Majesty's Government to implement the provisions of the Agreement relating to immunities and privileges. In recent years both this House and another place have expressed their concern at the apparently growing number of organisations and individuals to whom is granted special immunity and privilege. With that in mind, while pointing out that this Order needs to be made before the United Kingdom can proceed to ratification of the agreement, I would also stress that the extent of immunity and privilege is limited. For example, an exception from immunity is made 1467 both for the organisation and its officers in respect of civil proceedings relating to motor vehicle accidents and motor traffic offences. This limitation will mean that the organisation and all its employees will be subject to the jurisdiction of our courts in respect of proceedings, both civil and criminal, which arise out of motor offences and accidents.
A second exception is that proceedings arising out of the exercise of the Bank's powers to borrow money, guarantee obligations, or buy, sell or underwrite the sale of securities, are not covered. This means that when the Bank is raising loans or engaging in any of the financial transactions which will form part of its functions, it will be in the same position as any other entity and not protected from suit. This limitation should ensure the ability of the Bank to raise money on terms as favourable as any other commercial enterprise. We shall also be making a reservation to our ratification of the Agreement in respect of deduction of tax at the source in the United Kingdom and in the privileged use of telecommunications in the United Kingdom.
Under the present Order all officers and staff, including governors and directors of the Bank, are entitled only to a minimum level of privilege and immunity in respect of their official acts, and to exemption from income tax in respect of their official emoluments. From the immunity in respect of official acts, which is essential to enable officers to discharge their functions freely, there are excepted, as I have indicated, civil or criminal proceedings relating to motor vehicle damage or accidents. I might add that, although immunity is restricted in the way I have described, the Order in any case will have little practical effect in this country since it is not at present foreseen that the Bank will establish regional offices here, or indeed need to send missions to this country. Nevertheless, the Order is essential to enable us to implement fully our obligations, which we shall freely accept on ratification of the agreement. We have a particular concern to see that the Bank will be able to function efficiently and successfully. As care has been taken to ensure that the limited character of the Order accords with views previously expressed in this House, I hope that approval will 1468 be given and my Motion accepted. I beg to move.

THE EARL OF BESSBOROUGH
My Lords, we are most grateful to the noble Lord for having explained this Order. As he has said, there has been considerable concern in your Lordships' House in the past about the proliferation of diplomatic immunities and privileges. But, in accordance with precedent, in view of the limitations which the noble Lord has described very precisely, and the fact that it will not have very much effect in this country itself, and also that officials will enjoy only the basic minimum of immunities and privileges, I do not think we can have any objection to the Order. Therefore, I hope that it will pass.

LORD HAWKE
My Lords, before we part with this Order may I ask the noble Lord whether these gentlemen can be taken to court if, for instance, they do not pay their rent for any house or building they occupy? I do not quite see why the employees of this Bank should require immunity from income tax. The noble Lord explained that it was essential for their proper functioning. I am equally clear that it would be essential for my proper functioning in this House that I should claim immunity from income tax, but there is very small likelihood that anybody would give it to me. Why are these people so singled out? If the noble Lord replies that they are a Government organisation, what about the Bank of England, what about the Reserve Bank of India, what about the various State banking associations? I simply do not know why it is necessary that we should give this privilege to a bank.

§ LORD BESWICK
My Lords, if I may first answer the noble Lord, Lord Hawke, the reason that it is necessary to give it to this particular Bank is that it is not an ordinary commercial bank. Its capital is provided by, and its operations are at the behest of, Governments and States. As the money is provided by Governments and States, it would obviously be 1469 very wrong for a Government to tax monies which are provided by other Governments. If the noble Lord were representing this country in the United States, as some noble Lords have, I think he would find it strange if the Government of the United States were to tax the emoluments which he received from the United Kingdom Government. This is a convention as between Governments, and I should have thought that it was acceptable.
With regard to the point about the employees of the Bank being liable to civil or criminal proceedings if they did not pay rent, if in the inconceivable circumstances of the non-paid rent being for premises which they were occupying in order to carry out the purposes of the Bank—

LORD HAWKE
I am thinking of their private dwellings.

§ LORD BESWICK
If the noble Lord is thinking of their private dwellings, he will have in mind the phrase I used about actions taken in accordance with the duties of the Bank, as an officer of the bank. I should not have thought it would apply to any behaviour in connection with their own private residences.
So far as the general question of immunities is concerned, I much appreciate what the noble Earl, Lord Bess borough, said. I thank him for welcoming the Bill, and both he and the House may be interested to know, on this general question of immunities and privileges, a matter which has exercised the minds of noble Lords before now, that there is a Committee on Legal Co-operation of the Council of Europe reviewing this whole field. The United Kingdom will be in the chair, and the object of this exercise is to try to get commonly accepted rules which will give proper protection to international civil servants, without unnecessary privilege. I should have thought that this is something we would all welcome. I hope that that answers the questions that have been raised.

§ LORD ROWLEY
My Lords, might I ask my noble friend to clear up one point? Is not the Asian Development Bank in the same category as a United Nations Special Agency, and is it not the invariable rule that immunity such as is proposed in this Order is given to 1470 all those serving in an international agency of this kind?

§ LORD BESWICK
My Lords, my noble friend is absolutely right; there are many precedents for this, several of which we have accepted in this House in recent weeks. The only difference between this and other precedents is that the immunity is rather more limited in this case than in some of the others.

THE EARL OF BESSBOROUGH
My Lords, could the noble Lord say when the reports of the Council of Europe Legal Committee is likely to be complete in this matter?

§ LORD BESWICK
I understand, in the autumn, but I should like notice of the question. I will write to the noble Earl on this point.